Is it possible that they already issued and repurchased 500,000
shares for 82 cents in the "open market" recently? Like
we already have a strike price in place if accepted?
I would love to hear an analysis because you guys understand
things that I don't, but that aside.
(1) Sales up 12%. Operating income up 19% and at its highest margin
ever.
The company continues to be run very efficiently.
(2) Sales up $522,000. Cash up $929,000.
If someone can explain that comparison, other than the company's
extreme efficiency, please share.
(3) They raised their dividend.
Since they are proposing the ESOP, is the dividend hike a bit of a
being less significant?
I know they are saving their cash for investments, but
with cash up 18 cents in 2017 to sit at 68 cents per share, and
cash should be up at least 12 cents in 2018 to 80 cents ... pick
any number you want, one thing for sure is that they
could pay out a ton. A headline of "20% dividend raise" seems empty.
Maybe we are looking at $1 a share in cash by year end 2019 if they
sit tight. Paying out six cents seems very low. What is the reason?
(4) More new business potential. Maybe state run programs. Maybe
expanded profile which first needs development and approval.
The new states are a big wild card. There is no way to predict
how quickly the patch will be adopted. Ad nauseum, I've said these
things take time. But the cumulative affect is enormous for the
company. Huge long term revenue potential growth,
(5) Sales up 12 percent. They would have been higher, but pricing
pressure is costing them business. This should be a concern. The
tone of the letter seems to say that we may not be achieving 12 percent
growth in 2018. Demand is down. LH, DGX, OSUR, PMD all are trading
at year lows. So it is not just an us thing.
(6) What if earnings growth is slowing down, and about to take a hit
due to their investments on top of that? This wild card of entering
the medical market, and a potential new device, gives me reason to
need to know more. Once a year communication is terrible to begin
with, and then its a year old. But there are more question marks now.
(7) My value has not increased if in fact earnings may not have been
any much higher in 2018.
I'm embarrassed that I post to begin with and have posted knowing
absolutely nothing. Results matter, so at least I've scored there.
All signs from my research say that the patch is adopted more and
more widely. I don't like it when Deet says they need something new.
What does he see? What am I missing?
AND another misunderstanding is there was already an ESOP in place from
1997, and I never figured that in to a capital structure, and I did not
know if I had to, nor the ramifications of this proposal.
That is what gives me pause to post.
$3 a share, yes.
